What determines government spending multipliers?
|
|
- Philippa York
- 5 years ago
- Views:
Transcription
1 What determines government spending multipliers? Paper by Giancarlo Corsetti, André Meier and Gernot J. Müller Presented by Michele Andreolli 12 May 2014
2 Outline Overview Empirical strategy Results Remarks
3 Overview Empirical paper on the government spending multiplier Multiplier is conditional on the economic environment: Exchange rate regime State of public finances Financial crisis
4 Empirical Problem How to identify government spending shocks Need an exogenous shock, orthogonal to the information set of previous period Identification strategies: VAR with implementation lag of fiscal policy, Blanchard and Perotti (2002), Ilzetzki et al. (2011) Event studies with military expenditures, Ramey and Shapiro (1998) VAR with sign restrictions, Mountford and Uhlig (2009) Internally consistent general equilibrium model, DSGE, Woodford (2011)
5 Empirical Strategy Two stage approach, Fiscal rule and Panel regression, developed by Perotti (1999) With the residuals from the country specific fiscal rule they identify the fiscal shocks g t,i = φ i + η i trend i + β i,1 g t 1,i + β i,2 g t 2,i + γ i,1 y t 1,i + γ i,2 y t 2,i + θ i cli t 1,i + δ i b t 1,i + ρ i,1 peg t 1,i + ρ i,2 strain t,i + ρ i,3 crisis t 1,i + ε t,i (1) Crucial assumption, no contemporaneous effect from regressors (output) to government spending
6 Second stage Panel regression (FE) of the effect of the estimated fiscal shock conditional on the environment on various explanatory variable x t,i = α i + µ i trend i + χ i x t 1,i + σ 1ˆε t,i + σ 2ˆε t 1,i + σ 3ˆε t 2,i + σ 4ˆε t 3,i + κ 1 (ˆε t,i d t,i ) + κ 2 (ˆε t 1,i d t 1,i ) + κ 3 (ˆε t 2,i d t 2,i ) + κ 4 (ˆε t 3,i d t 3,i ) + γ 1 d t,i + γ 2 d t 1,i + γ 3 d t 2,i + γ 4 d t 3,i + u t,i (2) d it : exchange rate regime, state of public finances or financial crisis x it : government spending, output, consumption, investment, trade balance, REER, interest rate, inflation
7 Data 17 OECD countries Annual data Government spending: volume of final government consumption expenditure No transfers No taxes No automatic stabilizers Composite leading indicator, to identify policy makers expectations on future cycle
8 First stage results
9 First stage results
10 Second stage results Unconditional effect of fiscal shocks in line with common wisdom Multiplier smaller than one, crowds out of investment, reduces net exports, REER appreciates and then depreciates, reduces inflation on impact Conditional effect built on a baseline with flexible exchange rate, sound public finances and no financial crisis
11 Currency peg vs baseline Multiplier zero with flexible exchange rate, consumption and investment have the same behavior Net export decrease more with peg Monetary policy is less accommodative with pegs (non credible pegs) REER appreciates for peg and depreciates for flexible exchange rate
12 Weak public finances vs baseline Lower multiplier and more crowding out with weak public finances No effect on impact on consumption, turns positive over time (not good measure of fiscal strain, e.g. Japan) Inflation and interest rate are more pronounced, REER and net export less pronounced
13 Financial crisis vs baseline Huge multiplier on output and consumption, crowding in of investment, deterioration of trade balance with financial crisis Inflation, interest rate and REER responses are magnified Motive for ex ante fiscal buffer Theoretical reason (liquidity-constrain) or violation of identification assumption of no contemporaneous effect of output on government spending?
14 Summary of output multiplier Zero on baseline, negative in long run Similar with a peg Fiscal strain make it negative Financial crisis make it big, no long run reduction
15 Remarks The multiplier is conditional on the economic conditions Exchange rate regime changes the response, support for recent studies that find depreciation after spending increase. That s true for flexible exchange rate Fiscal stimula seem to work in financial crisis and there is a rationale for building a buffer in good times
16 Thank you!
17 My remarks 1 The R 2 of the first stage is huge 1. The reason why confidence bands are very small is that they are not identifying a sizable variation in government spending. For Italy R 2 =.99, therefore given that G/Y.2 1, on average the observed shock is 0.2% of Italian GDP Cyclical changes thanks to automatic stabilizers are likely to be on average higher than that. Economically it is more important. 1 Source: OECD Economic Outlook Database: volume of final government consumption expenditure (CGV) and GDP for 2012
18 My remarks 2 Fiscal stimula seem to work in financial crisis and there is a rationale for building a buffer in good times But what seem to be crucial is the pass-through of the fiscal strain to funding costs A policy prescription would be to make the economy insensitive to fiscal strain (e.g. banking union in EZ)
19 References - Blanchard, O.J. and R. Perotti (2002). An empirical characterization of the dynamic effects of changes in government spending and taxes on output, Quarterly Journal of Economics, 117(4), November, Ilzetzki, E.O., E. Mendoza and C. Vegh (2011). How big (small?) are fiscal multipliers?, mimeo - Mountford, A. and H. Uhlig (2009). What are the effects of fiscal policy shocks? Journal of Applied Econometrics, 24(6), Perotti, R. (1999). Fiscal policy in good times and bad, Quarterly Journal of Economics, 114(4), Ramey, V.A. and M.D. Shapiro (1998). Costly capital reallocation and the effects of government spending, Carnegie Rochester Conference on Public Policy, 48, Woodford, M. (2011). Simple analytics of the government expenditure multiplier, American Economic Journal: Macroeconomics, 3, 135.
Government spending shocks, sovereign risk and the exchange rate regime
Government spending shocks, sovereign risk and the exchange rate regime Dennis Bonam Jasper Lukkezen Structure 1. Theoretical predictions 2. Empirical evidence 3. Our model SOE NK DSGE model (Galì and
More informationAssessing the Effects of Government Spending Shocks: Evidence from OECD and Non-OECD Countries
Assessing the Effects of Government Spending Shocks: Evidence from OECD and Non-OECD Countries [Preliminary and Incomplete] Panagiotis Th. Konstantinou Andromachi Partheniou AUEB AUEB Abstract We estimate
More informationUsing Exogenous Changes in Government Spending to estimate Fiscal Multiplier for Canada: Do we get more than we bargain for?
Using Exogenous Changes in Government Spending to estimate Fiscal Multiplier for Canada: Do we get more than we bargain for? Syed M. Hussain Lin Liu August 5, 26 Abstract In this paper, we estimate the
More informationDiscussion of Corsetti, Meyer and Muller, What Determines Government Spending Multipliers?
Discussion of Corsetti, Meyer and Muller, What Determines Government Spending Multipliers? Michael Woodford Columbia University Federal Reserve Bank of New York June 3, 2010 Woodford (Columbia) Corsetti
More informationFiscal Multipliers: Lessons from the Great Recession for Small Open Economies
Fiscal Multipliers: Lessons from the Great Recession for Small Open Economies Giancarlo Corsetti (Cambridge & CEPR) Gernot Müller (Bonn & CEPR) Stockholm June 8, 2016 Swedish Fiscal Policy Council 1. Introduction
More informationGernot Müller (University of Bonn, CEPR, and Ifo)
Exchange rate regimes and fiscal multipliers Benjamin Born (Ifo Institute) Falko Jüßen (TU Dortmund and IZA) Gernot Müller (University of Bonn, CEPR, and Ifo) Fiscal Policy in the Aftermath of the Financial
More informationWhat determines government spending multipliers?
What determines government spending multipliers? Giancarlo Corsetti European University Institute, University of Rome III and CEPR Gernot J. Müller University of Bonn and CEPR May André Meier International
More informationDebt Burdens and the Interest Rate Response to Fiscal Stimulus: Theory and Cross-Country Evidence.
Debt Burdens and the Interest Rate Response to Fiscal Stimulus: Theory and Cross-Country Evidence. Jorge Miranda-Pinto 1, Daniel Murphy 2, Kieran Walsh 2, Eric Young 1 1 UVA, 2 UVA Darden School of Business
More informationFiscal policy in Europe: What is the appropriate stance?
Fiscal policy in Europe: What is the appropriate stance? Gernot Müller (U Bonn and CEPR) ETLA fiscal policy seminar Helsinki, October 16, 212 Fiscal stance in Europe Estimating multipliers Fiscal policy
More informationUsing Stock Returns to Identify Shocks to Government Spending
Using Stock Returns to Identify Shocks to Government Spending Jonas D.M. Fisher Ryan Peters Chicago Fed Atlanta Fed Fiscal Policy Conference, January 8-9, 21 Motivation What is the G multiplier? Use response
More informationWhat Drives Fiscal Multipliers? The Role of Private Debt and Wealth
1 / 35[width=2cm,center,respectlinebreaks] What Drives Fiscal Multipliers? The Role of Private Debt and Wealth Sebastian Gechert Keynes Tagung, Berlin, Februar 213 1 Agenda 2 / 35[width=2cm,center,respectlinebreaks]
More informationEstimating Macroeconomic Models of Financial Crises: An Endogenous Regime-Switching Approach
Estimating Macroeconomic Models of Financial Crises: An Endogenous Regime-Switching Approach Gianluca Benigno 1 Andrew Foerster 2 Christopher Otrok 3 Alessandro Rebucci 4 1 London School of Economics and
More informationOn the size of fiscal multipliers: A counterfactual analysis
On the size of fiscal multipliers: A counterfactual analysis Jan Kuckuck and Frank Westermann Working Paper 96 June 213 INSTITUTE OF EMPIRICAL ECONOMIC RESEARCH Osnabrück University Rolandstraße 8 4969
More informationInterest Rate Peg. Rong Li and Xiaohui Tian. January Abstract. This paper revisits the sizes of fiscal multipliers under a pegged nominal
Spending Reversals and Fiscal Multipliers under an Interest Rate Peg Rong Li and Xiaohui Tian January 2015 Abstract This paper revisits the sizes of fiscal multipliers under a pegged nominal interest rate.
More informationAn Estimated Fiscal Taylor Rule for the Postwar United States. by Christopher Phillip Reicher
An Estimated Fiscal Taylor Rule for the Postwar United States by Christopher Phillip Reicher No. 1705 May 2011 Kiel Institute for the World Economy, Hindenburgufer 66, 24105 Kiel, Germany Kiel Working
More informationUncertainty and the Transmission of Fiscal Policy
Available online at www.sciencedirect.com ScienceDirect Procedia Economics and Finance 32 ( 2015 ) 769 776 Emerging Markets Queries in Finance and Business EMQFB2014 Uncertainty and the Transmission of
More informationLECTURE 5 The Effects of Fiscal Changes: Aggregate Evidence. September 19, 2018
Economics 210c/236a Fall 2018 Christina Romer David Romer LECTURE 5 The Effects of Fiscal Changes: Aggregate Evidence September 19, 2018 I. INTRODUCTION Theoretical Considerations (I) A traditional Keynesian
More informationGovernment Spending Shocks in Quarterly and Annual Time Series
Government Spending Shocks in Quarterly and Annual Time Series Benjamin Born University of Bonn Gernot J. Müller University of Bonn and CEPR August 5, 2 Abstract Government spending shocks are frequently
More informationA Threshold Multivariate Model to Explain Fiscal Multipliers with Government Debt
Econometric Research in Finance Vol. 4 27 A Threshold Multivariate Model to Explain Fiscal Multipliers with Government Debt Leonardo Augusto Tariffi University of Barcelona, Department of Economics Submitted:
More informationKeynesian Views On The Fiscal Multiplier
Faculty of Social Sciences Jeppe Druedahl (Ph.d. Student) Department of Economics 16th of December 2013 Slide 1/29 Outline 1 2 3 4 5 16th of December 2013 Slide 2/29 The For Today 1 Some 2 A Benchmark
More informationReforms in a Debt Overhang
Structural Javier Andrés, Óscar Arce and Carlos Thomas 3 National Bank of Belgium, June 8 4 Universidad de Valencia, Banco de España Banco de España 3 Banco de España National Bank of Belgium, June 8 4
More informationThe Size of Fiscal Multipliers and the Stance of Monetary Policy in Developing Economies
Graduate Institute of International and Development Studies International Economics Department Working Paper Series Working Paper No. HEIDWP08-2017 The Size of Fiscal Multipliers and the Stance of Monetary
More informationTax multipliers: Pitfalls in measurement and identi cation
Tax multipliers: Pitfalls in measurement and identi cation Daniel Riera-Crichton Bates College Carlos Vegh Univ. of Maryland and NBER Guillermo Vuletin Colby College Indiana University April 25, 2013 Riera-Vegh-Vuletin
More informationBy Habits or Choice? Discretionary Spending in the Oecd
University of Siena From the SelectedWorks of riccardo fiorito June, 2013 By Habits or Choice? Discretionary Spending in the Oecd riccardo fiorito, University of Siena Available at: https://works.bepress.com/riccardo_fiorito/27/
More informationGovernment Spending Shocks in Quarterly and Annual Time Series
Government Spending Shocks in Quarterly and Annual Time Series Benjamin Born University of Bonn Gernot J. Müller University of Bonn and CEPR August 5, 211 Abstract Government spending shocks are frequently
More informationThe Size of Fiscal Multipliers and the Stance of Monetary Policy in Developing Economies
The Size of Fiscal Multipliers and the Stance of Monetary Policy in Developing Economies Jair N. Ojeda-Joya Oscar E. Guzman Working Paper No. 106 June 2017 INSTITUTE OF EMPIRICAL ECONOMIC RESEARCH Osnabrück
More informationOverborrowing, Financial Crises and Macro-prudential Policy. Macro Financial Modelling Meeting, Chicago May 2-3, 2013
Overborrowing, Financial Crises and Macro-prudential Policy Javier Bianchi University of Wisconsin & NBER Enrique G. Mendoza Universtiy of Pennsylvania & NBER Macro Financial Modelling Meeting, Chicago
More informationGovernment spending and firms dynamics
Government spending and firms dynamics Pedro Brinca Nova SBE Miguel Homem Ferreira Nova SBE December 2nd, 2016 Francesco Franco Nova SBE Abstract Using firm level data and government demand by firm we
More informationThe Evolution of Fiscal Multipliers during the Global Financial Crisis. The Case of Romania
B U C H A R E S T U N I V E R S I T Y O F E C O N O M I C S T U D I E S D O C T O R A L S C H O O L O F F I N A N C E A N D B A N K I N G The Evolution of Fiscal Multipliers during the Global Financial
More informationThe Effects of Government Spending on Real Exchange Rates: Evidence from Military Spending Panel Data
No. 16-14 The Effects of Government Spending on Real Exchange Rates: Evidence from Military Spending Panel Data Wataru Miyamoto, Thuy Lan Nguyen, and Viacheslav Sheremirov Abstract: Using panel data on
More informationGLOBAL IMBALANCES FROM A STOCK PERSPECTIVE
GLOBAL IMBALANCES FROM A STOCK PERSPECTIVE Enrique Alberola (BIS), Ángel Estrada and Francesca Viani (BdE) (*) (*) The views expressed here do not necessarily coincide with those of Banco de España, the
More informationFiscal Policy in Open Economies
Fiscal Policy in Open Economies Harris Dellas Klaus Neusser Manuel Wälti This draft: February 2005 PLEASE DO NOT QUOTE Abstract We study the effects of fiscal policy in a small, open economy. Under sluggish
More informationOn the Measurement of the Government Spending Multiplier in the United States An ARDL Cointegration Approach
MPRA Munich Personal RePEc Archive On the Measurement of the Government Spending Multiplier in the United States An ARDL Cointegration Approach Esmaeil Ebadi Department of Economics, Grand Valley State
More informationIdentifying of the fiscal policy shocks
The Academy of Economic Studies Bucharest Doctoral School of Finance and Banking Identifying of the fiscal policy shocks Coordinator LEC. UNIV. DR. BOGDAN COZMÂNCĂ MSC Student Andreea Alina Matache Dissertation
More informationFiscal Multipliers in Recessions. M. Canzoneri, F. Collard, H. Dellas and B. Diba
1 / 52 Fiscal Multipliers in Recessions M. Canzoneri, F. Collard, H. Dellas and B. Diba 2 / 52 Policy Practice Motivation Standard policy practice: Fiscal expansions during recessions as a means of stimulating
More informationThe Analytics of SVARs: A Unified Framework to Measure Fiscal Multipliers
The Analytics of SVARs: A Unified Framework to Measure Fiscal Multipliers Dario Caldara This Version: January 15, 2011 Does fiscal policy stimulate output? Structural vector autoregressions have been used
More informationThe Effects of Fiscal Policy: Evidence from Italy
The Effects of Fiscal Policy: Evidence from Italy T. Ferraresi Irpet INFORUM 2016 Onasbrück August 29th - September 2nd Tommaso Ferraresi (Irpet) Fiscal policy in Italy INFORUM 2016 1 / 17 Motivations
More informationWhat Are The Effects of Fiscal Policy Shocks in India?*
What Are The Effects of Fiscal Policy Shocks in India?* Preliminary Draft not to be quoted without permission Roberto Guimarães International Monetary Fund March, 2010 *The views expressed herein are those
More informationHow Large is the Government Spending Multiplier? Evidence from World Bank Lending
How Large is the Government Spending Multiplier? Evidence from World Bank Lending Aart Kraay presented by Iacopo Morchio Universidad Carlos III de Madrid http://www.uc3m.es October 31st, 2012 Motivation
More informationTen Years after the Financial Crisis: What Have We Learned from. the Renaissance in Fiscal Research?
Ten Years after the Financial Crisis: What Have We Learned from the Renaissance in Fiscal Research? by Valerie A. Ramey University of California, San Diego and NBER NBER Global Financial Crisis @10 July
More informationExchange rate regimes and fiscal multipliers
Exchange rate regimes and fiscal multipliers Benjamin Born, Falko Jüßen, and Gernot J. Müller February 27, 22 Abstract Does the fiscal multiplier depend on the exchange rate regime and, if so, how strongly?
More informationThe Young, the Old, and the Restless: Demographics and Business Cycle Volatility. Nir Jaimovich and Henry Siu
The Young, the Old, and the Restless: Demographics and Business Cycle Volatility Nir Jaimovich and Henry Siu What is the role of demographic change in explaining changes in business cycle volatility? Since
More informationHow Big (Small) Are Fiscal Multipliers?
How Big (Small) Are Fiscal Multipliers? Comments Antonio Fatás INSEAD Fiscal Policy, Stabilization and Sustainability Conference Florence June 6, 2011 Fiscal Multipliers Key policy question Large academic
More informationMeasuring How Fiscal Shocks Affect Durable Spending in Recessions and Expansions
Measuring How Fiscal Shocks Affect Durable Spending in Recessions and Expansions By DAVID BERGER AND JOSEPH VAVRA How big are government spending multipliers? A recent litererature has argued that while
More informationFISCAL POLICY AFTER THE GREAT RECESSION
FISCAL POLICY AFTER THE GREAT RECESSION Alberto Alesina Harvard a University sty and IGIER June 2012 What do we agree upon Tax smoothing principle Automatic stabilizers have to do their work That would
More informationFiscal Policy: Ready for The Next Shock?
Fiscal Policy: Ready for The Next Shock? Franziska Ohnsorge December 217 Duration of Global Expansions: Getting Older Although Not Yet Dying of Old Age 18 Global expansions (Number of years) 45 Expansions
More informationUniversity of Rijeka Faculty of Economics Rijeka. PhD RESEARCH PROPOSAL
University of Rijeka Faculty of Economics Rijeka PhD RESEARCH PROPOSAL Macroeconomic effects of fiscal policy in a small open economy: case of Croatia Milan Deskar-Škrbić PhD Candidate Rijeka, October
More informationThe Effects of Public Spending Shocks on Trade Balances in the European Union 1
The Effects of Public Spending Shocks on Trade Balances in the European Union 1 Roel Beetsma * University of Amsterdam, Tinbergen Institute and CEPR Massimo Giuliodori ** University of Amsterdam, Tinbergen
More informationFiscal Multipliers and Foreign Holdings of Public Debt
Fiscal Multipliers and Foreign Holdings of Public Debt Fernando Broner Daragh Clancy Alberto Martin Aitor Erce December 2017 Abstract This paper explores a natural connection between fiscal multipliers
More informationAusterity in the Aftermath of the Great Recession
Austerity in the Aftermath of the Great Recession Christopher L. House University of Michigan and NBER. Christian Proebsting EPFL École Polytechnique Fédérale de Lausanne Linda Tesar University of Michigan
More informationA Review on the Effectiveness of Fiscal Policy
A Review on the Effectiveness of Fiscal Policy Francesco Furlanetto Norges Bank May 2013 Furlanetto (NB) Fiscal stimulus May 2013 1 / 16 General topic Question: what are the effects of a fiscal stimulus
More informationEffects of Fiscal Policy Shocks in an Open Economy
Policy Research Working Paper 7654 WPS7654 Effects of Fiscal Policy Shocks in an Open Economy Evidence from Canada Vincent Belinga Public Disclosure Authorized Public Disclosure Authorized Public Disclosure
More informationGLOBAL IMBALANCES FROM A STOCK PERSPECTIVE
GLOBAL IMBALANCES FROM A STOCK PERSPECTIVE Ángel Estrada and Francesca Viani (*) 14 th EMERGING MARKET WORKSHOP Madrid (*) The views expressed here do not necessarily coincide with those of Banco de España
More informationTHE EFFECTS OF GOVERNMENT SPENDING ON REAL EXCHANGE RATES: EVIDENCE FROM MILITARY SPENDING PANEL DATA
THE EFFECTS OF GOVERNMENT SPENDING ON REAL EXCHANGE RATES: EVIDENCE FROM MILITARY SPENDING PANEL DATA Wataru Miyamoto Bank of Canada Thuy Lan Nguyen Santa Clara University Viacheslav Sheremirov Boston
More informationGovernment Spending Multipliers in Good Times and in Bad: Evidence from U.S. Historical Data
Government Spending Multipliers in Good Times and in Bad: Evidence from U.S. Historical Data Valerie A. Ramey University of California, San Diego and NBER and Sarah Zubairy Texas A&M April 2015 Do Multipliers
More informationA Reply to Roberto Perotti s "Expectations and Fiscal Policy: An Empirical Investigation"
A Reply to Roberto Perotti s "Expectations and Fiscal Policy: An Empirical Investigation" Valerie A. Ramey University of California, San Diego and NBER June 30, 2011 Abstract This brief note challenges
More informationCountry Spreads and Emerging Countries: Who Drives Whom? Martin Uribe and Vivian Yue (JIE, 2006)
Country Spreads and Emerging Countries: Who Drives Whom? Martin Uribe and Vivian Yue (JIE, 26) Country Interest Rates and Output in Seven Emerging Countries Argentina Brazil.5.5...5.5.5. 94 95 96 97 98
More informationGovernment Spending Multipliers under the Zero Lower Bound: Evidence from Japan
Government Spending Multipliers under the Zero Lower Bound: Evidence from Japan Wataru Miyamoto Thuy Lan Nguyen Dmitriy Sergeyev April 4, 27 Abstract Using a rich data set on government spending forecasts
More informationslides chapter 6 Interest Rate Shocks
slides chapter 6 Interest Rate Shocks Princeton University Press, 217 Motivation Interest-rate shocks are generally believed to be a major source of fluctuations for emerging countries. The next slide
More informationOptimal fiscal policy
Optimal fiscal policy Jasper Lukkezen Coen Teulings Overview Aim Optimal policy rule for fiscal policy How? Four building blocks: 1. Linear VAR model 2. Augmented by linearized equation for debt dynamics
More informationThe Economic and Social Review, Vol. 40, No. 4, Winter, 2009, pp
The Economic and Social Review, Vol. 40, No. 4, Winter, 2009, pp. 407 434 The Impact of Fiscal Shocks on the Irish Economy* AGUSTÍN S. BÉNÉTRIX IIIS, Trinity College Dublin PHILIP R. LANE IIIS, Trinity
More informationThe Economic Effects of Government Spending * (Preliminary Draft)
The Economic Effects of Government Spending * (Preliminary Draft) Matthew Hall and Aditi Thapar University of Michigan February 4, 7 Abstract We create a forecast-based measure of government spending shocks
More informationFiring Costs, Employment and Misallocation
Firing Costs, Employment and Misallocation Evidence from Randomly Assigned Judges Omar Bamieh University of Vienna November 13th 2018 1 / 27 Why should we care about firing costs? Firing costs make it
More informationThe Fiscal Impact of Population Aging in the United States by Henry J. Aaron
The Fiscal Impact of Population Aging in the United States by Henry J. Aaron Comments by Naoyuki Yoshino Professor of Economics, Keio University, Japan yoshino@econ.keio.ac.jp Bond Market Japan and
More informationSimulations of the macroeconomic effects of various
VI Investment Simulations of the macroeconomic effects of various policy measures or other exogenous shocks depend importantly on how one models the responsiveness of the components of aggregate demand
More informationFiscal Multipliers in Recessions
Fiscal Multipliers in Recessions Matthew Canzoneri Fabrice Collard Harris Dellas Behzad Diba March 10, 2015 Matthew Canzoneri Fabrice Collard Harris Dellas Fiscal Behzad Multipliers Diba (University in
More informationThe Macroeconomics of Universal Health Insurance Vouchers
The Macroeconomics of Universal Health Insurance Vouchers Juergen Jung Towson University Chung Tran University of New South Wales Jul-Aug 2009 Jung and Tran (TU and UNSW) Health Vouchers 2009 1 / 29 Dysfunctional
More informationTFP Persistence and Monetary Policy. NBS, April 27, / 44
TFP Persistence and Monetary Policy Roberto Pancrazi Toulouse School of Economics Marija Vukotić Banque de France NBS, April 27, 2012 NBS, April 27, 2012 1 / 44 Motivation 1 Well Known Facts about the
More informationDebt, Sovereign Risk and Government Spending
Debt, Sovereign Risk and Government Spending Rym Aloui Aurélien Eyquem November 5, 6 Abstract We investigate the relation between the size of government indebtedness and the effectiveness of government
More informationAdvanced Macroeconomics II. Fiscal Policy
Advanced Macroeconomics II Fiscal Policy Lorenza Rossi (Spring 2014) University of Pavia Part of these slides are based on Jordi Galì slides for Macroeconomia Avanzada II. Outline Fiscal Policy in the
More informationEstimating the effects of fiscal policy in Structural VAR models
Estimating the effects of fiscal policy in Structural VAR models Hilde C. Bjørnland BI Norwegian Business School Modell-og metodeutvalget, Finansdepartementet 3 June, 2013 HCB (BI) Fiscal policy FinDep
More informationObjectives of the lecture
Assessing the External Position Bank Indonesia International Workshop and Seminar Central Bank Policy Mix: Issues, Challenges, and Policies Jakarta, 9-13 April 2018 Rajan Govil The views expressed herein
More informationGovernment Spending Multipliers under the Zero Lower Bound: Evidence from Japan
Government Spending Multipliers under the Zero Lower Bound: Evidence from Japan Wataru Miyamoto Thuy Lan Nguyen Dmitriy Sergeyev This version: December 7, 215 Abstract Using a rich data set on government
More informationExchange rate regimes and fiscal multipliers
Exchange rate regimes and fiscal multipliers Benjamin Born, Falko Jüßen, and Gernot J. Müller May 4, 22 Abstract Does the fiscal multiplier depend on the exchange rate regime and, if so, how strongly?
More informationThe Economic Effects of Government Spending * (First Draft)
The Economic Effects of Government Spending * (First Draft) Matthew Hall and Aditi Thapar University of Michigan August 5, 6 Abstract We create a forecast-based measure of government spending shocks from
More informationConvergence, capital accumulation and the nominal exchange rate
Convergence, capital accumulation and the nominal exchange rate Péter Benczúr and István Kónya Magyar Nemzeti Bank and Central European University September 2 Disclaimer The views expressed are those of
More informationFiscal Consolidations in Currency Unions: Spending Cuts Vs. Tax Hikes
Fiscal Consolidations in Currency Unions: Spending Cuts Vs. Tax Hikes Christopher J. Erceg and Jesper Lindé Federal Reserve Board June, 2011 Erceg and Lindé (Federal Reserve Board) Fiscal Consolidations
More informationFiscal Multipliers and Foreign Holdings of Public Debt
Working Paper Series 30 2018 Fiscal Multipliers and Foreign Holdings of Public Debt This paper finds that the effects of fiscal expansions on economic activity are stronger when governments have access
More informationOil Price Uncertainty in a Small Open Economy
Yusuf Soner Başkaya Timur Hülagü Hande Küçük 6 April 212 Oil price volatility is high and it varies over time... 15 1 5 1985 199 1995 2 25 21 (a) Mean.4.35.3.25.2.15.1.5 1985 199 1995 2 25 21 (b) Coefficient
More informationFiscal Policy in Open Economies
Fiscal Policy in Open Economies Harris Dellas Klaus Neusser Manuel Wälti September 2, 25 Abstract We argue that the significance of the exchange rate regime for the effectiveness of fiscal policy in small
More informationGovernment Spending Multipliers under Zero Lower Bound: Evidence from Japan
Government Spending Multipliers under Zero Lower Bound: Evidence from Japan Wataru Miyamoto Thuy Lan Nguyen Dmitriy Sergeyev This version: October 8, 215 Abstract Using a rich data set on government spending
More informationGovernment Spending Multipliers under Zero Lower Bound: Evidence from Japan
MACROECON & INT'L FINANCE WORKSHOP presented by Thuy Lan Nguyen FRIDAY, Sept. 25, 215 3:3 pm 5: pm, Room: HOH-76 Government Spending Multipliers under Zero Lower Bound: Evidence from Japan Wataru Miyamoto
More information5. STRUCTURAL VAR: APPLICATIONS
5. STRUCTURAL VAR: APPLICATIONS 1 1 Monetary Policy Shocks (Christiano Eichenbaum and Evans, 1998) Monetary policy shocks is the unexpected part of the equation for the monetary policy instrument (S t
More informationInflation Dynamics During the Financial Crisis
Inflation Dynamics During the Financial Crisis S. Gilchrist 1 1 Boston University and NBER MFM Summer Camp June 12, 2016 DISCLAIMER: The views expressed are solely the responsibility of the authors and
More informationFirm-specific Exchange Rate Shocks and Employment Adjustment: Theory and Evidence
Firm-specific Exchange Rate Shocks and Employment Adjustment: Theory and Evidence Mi Dai Jianwei Xu Beijing Normal University November 2016 Mi Dai (Beijing Normal University) exchange rate and employment
More informationOn the new Keynesian model
Department of Economics University of Bern April 7, 26 The new Keynesian model is [... ] the closest thing there is to a standard specification... (McCallum). But it has many important limitations. It
More informationInflation Dynamics During the Financial Crisis
Inflation Dynamics During the Financial Crisis S. Gilchrist 1 R. Schoenle 2 J. W. Sim 3 E. Zakrajšek 3 1 Boston University and NBER 2 Brandeis University 3 Federal Reserve Board Theory and Methods in Macroeconomics
More informationLecture 4. Extensions to the Open Economy. and. Emerging Market Crises
Lecture 4 Extensions to the Open Economy and Emerging Market Crises Mark Gertler NYU June 2009 0 Objectives Develop micro-founded open-economy quantitative macro model with real/financial interactions
More informationWhat the Cyclical Response of Advertising Reveals about Markups and other Macroeconomic Wedges
What the Cyclical Response of Advertising Reveals about Markups and other Macroeconomic Wedges Robert E. Hall Hoover Institution and Department of Economics Stanford University Conference in Honor of James
More informationWAS FISCAL STIMULUS IN USA IN RECENT CRISES REASONABLE? EMPIRICAL INVESTIGATION OF DISCRETIONAL FISCAL POLICY ON OUTPUT IN A SVEC FRAMEWORK
WAS FISCAL STIMULUS IN USA IN RECENT CRISES REASONABLE? EMPIRICAL INVESTIGATION OF DISCRETIONAL FISCAL POLICY ON OUTPUT IN A SVEC FRAMEWORK Adrian Burda Uniwersytet Ekonomiczny w Krakowie Koło Naukowe
More informationWhat drives the short-run costs of fiscal consolidation? Evidence from OECD countries
What drives the short-run costs of fiscal consolidation? Evidence from OECD countries Ryan Banerjee and Fabrizio Zampolli 2 nd Research Network Meeting on Macroeconomics and global financial markets Basel,
More informationHeterogeneous Firm, Financial Market Integration and International Risk Sharing
Heterogeneous Firm, Financial Market Integration and International Risk Sharing Ming-Jen Chang, Shikuan Chen and Yen-Chen Wu National DongHwa University Thursday 22 nd November 2018 Department of Economics,
More informationEnrique Martínez-García. University of Texas at Austin and Federal Reserve Bank of Dallas
Discussion: International Recessions, by Fabrizio Perri (University of Minnesota and FRB of Minneapolis) and Vincenzo Quadrini (University of Southern California) Enrique Martínez-García University of
More informationBonn Summer School Advances in Empirical Macroeconomics
Bonn Summer School Advances in Empirical Macroeconomics Karel Mertens Cornell, NBER, CEPR Bonn, June 2015 2.2 Recent Evidence on Spending Shocks Surveys: Ramey, 2011, Can Government Purchases Stimulate
More informationEffects of Fiscal Shocks in a Globalized World
Effects of Fiscal Shocks in a Globalized World by Alan Auerbach and Yuriy Gorodnichenko Discussion by Christopher Erceg Federal Reserve Board November 2014 These comments should not be interpreted as reflecting
More informationEstimating the Economic Impacts of Highway Infrastructure
Estimating the Economic Impacts of Highway Infrastructure Daniel Wilson (Federal Reserve Bank of San Francisco) Infrastructure and Economic Growth, FRB Chicago, Nov. 3, 2014 *The views expressed in this
More informationTax Cuts for Whom? Heterogeneous Effects of Income Tax Changes on Growth and Employment
Tax Cuts for Whom? Heterogeneous Effects of Income Tax Changes on Growth and Employment Owen Zidar Chicago Booth and NBER December 1, 2014 Owen Zidar (Chicago Booth) Tax Cuts for Whom? December 1, 2014
More informationCommentary: Is There a Role for Discretionary Fiscal Policy?
Commentary: Is There a Role for Discretionary Fiscal Policy? Fumio Hayashi It s a great honor to be part of this prestigious conference. I am pleased to serve as a discussant for the paper by Alan Auerbach,
More informationFiscal consolidation episodes in OECD countries: the role of tax compliance and fiscal space
Fiscal consolidation episodes in OECD countries: the role of tax compliance and fiscal space by Laurent Ferrara, Economics and International and European Relations Directorate Germain Gauthier, Economics
More informationON THE LONG-TERM MACROECONOMIC EFFECTS OF SOCIAL SPENDING IN THE UNITED STATES (*) Alfredo Marvão Pereira The College of William and Mary
ON THE LONG-TERM MACROECONOMIC EFFECTS OF SOCIAL SPENDING IN THE UNITED STATES (*) Alfredo Marvão Pereira The College of William and Mary Jorge M. Andraz Faculdade de Economia, Universidade do Algarve,
More information